Diesel tax hike plan highlights internal commission rift
The European Commission has tabled a controversial bill to raise the minimum duty on diesel from 2012, aimed at stamping out so-called fuel tourism and decreasing air pollution.
But even after three weeks of internal struggle, the college of commissioners failed to speak with one voice, with the Lithuanian EU budget commissioner Dalia Grybauskaite officially opposing the plan.
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"Today's decision is fully in line with results of the last European Council... which put environment even higher on political agenda," EU tax commissioner Laszlo Kovacs said, defending his own proposal.
Mr Kovacs's paper suggests harmonizing the minimum level of excise duties at €359 per 1,000 litres of diesel in 2012 and subsequently at €380 in 2014, something which would force 21 EU states to increase their current rates.
"Such a move will firstly, contribute to decrease CO2 emissions and secondly, improve the functioning of the internal market," Mr Kovacs said while describing the internal debate among commissioners as long and lively.
Currently, the haulage sector takes advantage of large differences in national excise duties – varying from €220 to €693 – with big trucks making detours from their routes and filling up in a state where it is cheapest. This so-called fuel tourism generates more emissions and losses in some EU states coffers, the Hungarian commissioner underlined.
For example, fuel tourism cost Germany – believed to be the strongest advocate of the tabled proposal - €1.9 billion in 2004, as excise duties represent roughly between 30 to 60 percent of the pump price and are responsible for six to 18 percent of the running costs of a road haulage business.
In addition, the haulage sector alone counts for 19.3 percent of the CO2 emissions in the EU-25, while it is expected that the shift from the "do nothing" option to the current proposal would see a CO2 emissions reduction of 38.7 percent.
Firm opposition from EU budget commissioner
But Mr Kovacs' arguments seem not to have any impact on EU budget commissioner Dalia Grybauskaite, who refused to give her blessing to the plan.
Previously during the drafting process, four other commissioners - Charlie McCreevy (internal market), Danuta Hübner (regional policy), Siim Kallas (administrative affairs) and Viviane Reding (information society) - lined up together to oppose any tax rise.
Mrs Grybauskaite, a former finance minister in Lithuania, told EUobserver last week that she was "against proposals which do not have a macroeconomic assessment and are not fitting into overall EU taxation strategy."
"I'm against ecological populism which now has become very modern and everything you want to push through you highlight by referring to ecological influence," Mrs Grybauskaite also said, hinting the document may not have a long lifetime.
EU tax commissioner Laszlo Kovacs shook off those statements by saying "I have referred my colleague to the exact paragraphs in the impact study."
However, Mr Kovacs is likely to experience a similar battle with some EU capitals, who have argued that a further rise in diesel tax would translate into the overall increase of prices and inflation, possibly creating a delay of eurozone entry for some new member states.
"If I tabled a proposal only if I'm one-hundred percent sure it will gain unanimity, I would not propose anything during the entire five-year term in office," Mr Kovacs said, adding he will work towards unanimous support by all member states, as required.
In fact, Mr Kovacs has already made one concession in advance, as the paper pledges to respect existing transitional periods - currently enjoyed by some member states - while granting them two extra years to adjust to the increase after the transitional period expires.